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Daily Pivots: (S1) 0.8371; (P) 0.8392; (R1) 0.8405; More...

Intraday bias in EUR/GBP remains on the downside as fall from 0.8472 short term top is in progress. Sustained break of 55 D EMA (now at 0.8354) will argue that whole rebound from 0.8221 has completed as a corrective move. Nevertheless, strong bounce from the 55 D EMA, followed by break of 0.8419 minor resistance, will argue that the pull back has completed and bring retest of 0.8472.

In the bigger picture, a medium term bottom should be in place at 0.8221, just ahead of 0.8201 key support (2022 low). Sustained trading above 55 W EMA (now at 0.8442) will pave the way to 0.8624 cluster zone (38.2% retracement of 0.9267 to 0.8221 at 0.8621), even just as a correction to the down trend from 0.9267 (2022 high). But still, medium term outlook will be neutral at best as long as 0.8621/4 holds.

Daily Pivots: (S1) 1.6656; (P) 1.6684; (R1) 1.6711; More...

Intraday bias in EUR/AUD remains neutral as consolidation continues below 1.6800. In case of another dip, strong support is expected from 38.2% retracement of 1.5963 to 1.6800 at 1.6480 to contain downside. On the upside, firm break of 1.6800 will resume the rally from 1.5963. However, sustained break of 1.6480 will bring deeper correction 61.8% retracement at 1.6283 instead.

In the bigger picture, EUR/AUD is holding on to 1.5996 key support (2024 low) despite brief breach. Larger up trend from 1.4281 (2022 low) is still in favor to resume through 1.7180 at a later stage. Nevertheless, sustained break of 1.5996 will indicate that such up trend has completed and deeper decline would be seen.

Daily Pivots: (S1) 0.9418; (P) 0.9442; (R1) 0.9455; More....

Intraday bias in EUR/CHF remains neutral and outlook is unchanged. On the downside, firm break of 0.9242 support will indicate rejection by 38.2% retracement of 0.9928 to 0.9204 at 0.9481. Deeper fall would then be seen back to channel support (now at 0.9377). However, strong rebound from current level will keep the choppy rally from 0.9204 intact.

In the bigger picture, fall from 0.9928 should have completed at 0.9204 with the current strong rebound, after failing to sustain below 0.9252 (2023 low). It's still early to confirm long term bullish reversal. But even as a corrective move, current rebound could extend to 61.8% retracement of 0.9928 to 0.9204 at 0.9651. On the downside, firm break of 55 D EMA (now at 0.9390) will maintain medium term bearishness and bring retest of 0.9204 low.

Daily Pivots: (S1) 1.4367; (P) 1.4394; (R1) 1.4428; More...

No change in USD/CAD's outlook as range trading continues. Intraday bias stays neutral for the moment. Further rally is expected as long as 1.4260 support holds. On the upside, firm break of 1.4516 will resume larger up trend to 1.4667/89 key resistance zone. Nevertheless, firm break of 1.4260 will turn bias to the downside for deeper pullback to 55 D EMA (now at 1.4235) and below.

In the bigger picture, up trend from 1.2005 (2021) is in progress for retesting 1.4667/89 key resistance zone (2020/2015 highs). Decisive break there will confirm long term up trend resumption. Next target is 100% projection of 1.2401 to 1.3976 from 1.3418 at 1.4993. Medium term outlook will remain bullish as long as 1.3976 resistance turned holds (2022 high), even in case of deep pullback.

Daily Pivots: (S1) 0.6228; (P) 0.6262; (R1) 0.6286; More...

Intraday bias in AUD/USD remains mildly on the downside. Corrective rebound from 0.6130 could have completed at 0.6329. Deeper fall would be seen to retest 0.6130 low. On the upside, above 0.6329 will resume the rebound. But still, strong resistance is expected from 38.2% retracement of 0.6941 to 0.6130 at 0.6440 to limit upside to complete this corrective rebound.

In the bigger picture, fall from 0.6941 (2024 high) is seen as part of the down trend from 0.8006 (2021 high). Next medium term target is 61.8% projection of 0.8006 to 0.6169 from 0.6941 at 0.5806. In any case, outlook will stay bearish as long as 55 W EMA (now at 0.6545) holds.

Daily Pivots: (S1) 154.61; (P) 155.30; (R1) 156.21; More...

Intraday bias in USD/JPY stays neutral at this point. On the upside, break of 156.74 resistance will indicate that fall from 158.86 has completed as a correction. Intraday bias will be back on the upside for 158.86 and above to resume the whole rally from 138.57. On the downside, below 153.70 will resume the fall from 158.86 to 38.2% retracement of 139.57 to 158.86 at 151.49.

In the bigger picture, price actions from 161.94 are seen as a corrective pattern to rise from 102.58 (2021 low). The range of medium term consolidation should be set between 38.2% retracement of 102.58 to 161.94 at 139.26 and 161.94. Nevertheless, sustained break of 139.26 would open up deeper medium term decline to 61.8% retracement at 125.25.

Daily Pivots: (S1) 0.9012; (P) 0.9041; (R1) 0.9071; More…

Intraday bias in USD/CHF stays neutral at this point. Rise from 0.9374 remains intact so far with strong support support seen from near term rising channel. On the upside, break of 0.9107 will target 0.9200 and 0.9223 key resistance. On the downside, however, break of 0.8964 will resume the fall from 0.9200 to 38.2% retracement of 0.8374 to 0.9200 at 0.8884 next.

In the bigger picture, as long as 0.9223 resistance holds, price actions from 0.8332 (2023 low) are seen as a medium term corrective pattern. That is, long term down trend is in favor to resume through 0.8332 at a later stage. However, sustained break of 0.9223 will be an important sign of bullish trend reversal.

Daily Pivots: (S1) 1.2404; (P) 1.2453; (R1) 1.2491; More...

Intraday bias in GBP/USD stays neutral and outlook is unchanged. Rebound from 1.2099 is seen as a corrective move. While another rise cannot be ruled out, strong resistance could be seen 38.2% retracement of 1.3433 to 1.2099 at 1.2609 to limit upside. On the downside, below 1.2292 minor support will bring retest of 1.2099 low. However, sustained trading above 1.2609 will raise the chance of reversal and target 61.8% retracement at 1.2923.

In the bigger picture, rise from 1.0351 (2022 low) should have already completed at 1.3433 (2024 high), and the trend has reversed. Further fall is now expected as long as 1.2810 resistance holds. Deeper decline should be seen to 61.8% retracement of 1.0351 to 1.3433 at 1.1528, even as a corrective move. However, firm break of 1.2810 will dampen this bearish view and bring retest of 1.3433 high instead.

Daily Pivots: (S1) 1.0398; (P) 1.0447; (R1) 1.0480; More...

Intraday bias in EUR/USD stays neutral and outlook is unchanged. On the downside, break of 1.0371 support will indicate rejection by 38.2% retracement of 1.1213 to 1.0176 at 1.0572 and retain near term bearishness. Retest of 1.0176 low should be seen next. On the upside, though, decisive break of 1.0572 will raise the chance of bullish reversal, and target 61.8% retracement at 1.0817.

In the bigger picture, outlook is mixed as fall from 1.1274 (2023 high) could either be the second leg of the corrective pattern from 0.9534 (2022 low), or another down leg of the long term down trend. Strong support from 61.8 retracement of 0.9534 to 1.1274 at 1.0199 will favor the former case, and sustained break of 55 W EMA (now at 1.0722) will argue that the third leg might have started. However, sustained trading below 1.0199 will favor the latter case and bring retest of 0.9534 low.

Forex markets are trading with a mild risk-off tone in a relatively quiet day so far, with many Asian markets closed for Lunar New Year holiday. Safe-haven currencies, including Yen, Swiss Franc, and Dollar, are holding firm, while commodity-linked currencies are on the weaker side. However, there is little follow-through momentum, with traders hesitant to make significant moves for now. The AI-driven tech rout that dominated sentiment earlier in the week appears to have faded from traders’ focus, with attention squarely on Fed and BoC policy updates.

In Asia Pacific, expectations for an RBA rate cut in February have strengthened following weaker-than-expected Q4 CPI data. Westpac’s Chief Economist Luci Ellis emphasized that trimmed mean inflation data suggests disinflation is advancing more quickly than anticipated, which should give RBA confidence to start cutting rates. CBA’s Head of Australian Economics, Gareth Aird, echoed this view, calling the latest figures a "green light" for policy normalization. While Australian Dollar weakened in response to the data, there has been no sharp acceleration in selling pressure, indicating that markets had already priced in the likelihood of the dovish shift.

BoC is widely expected to cut rates by 25bps today, lowering the policy rate to 3.00%. As rates enter deeper into the estimated neutral range of 2.25–3.25%, policymakers will likely take a more cautious approach moving forward. Adding to the uncertainty is the risks of trade conflict with the US, which could complicate BoC’s policy outlook. Traders will pay close attention to Governor Tiff Macklem’s assessment of economic risks, particularly how the central bank plans to balance easing monetary policy with external uncertainties.

Meanwhile, FOMC is expected to hold rates steady at 4.25–4.50%. The main focus will be on whether Fed signals an extended pause in its rate-cutting cycle, either in its statement or through Chair Jerome Powell’s press conference. Market pricing currently assigns a 67.6% probability of a hold in March and a 49.3% chance in May, with expectations for the next rate cut rising to 75% in June. Powell’s tone will be critical in either reinforcing or reshaping these expectations, with any hawkish signals likely to support the Dollar, while a dovish stance could provide room for further risk-on sentiment.

Technically, USD/CAD remains within range between 1.4260 and 1.4516. While the broader outlook remains bullish as long as 1.4260 holds as support, an immediate breakout appears unlikely unless today’s policy announcements deliver a significant surprise. A clearer directional move may only emerge once the tariff situation between the US and Canada is clarified, which remains a key source of uncertainty for the pair.

For the week so far, risk aversion continues to dominate, though without significant intensification. Yen remains the strongest performer, followed by Swiss Franc and Dollar. Aussie continues to struggle at the bottom, followed by Kiwi and then Euro. Sterling and Loonie are positioning in the middle.

German Gfk consumer sentiment falls to -22.4, recovery hopes fade

Germany’s GfK Consumer Sentiment Index for February fell to -22.4, down from -21.4 and missing expectations of -20.5.

In January, economic expectations dropped by 1.9 points to -1.6, while income expectations declined by 2.5 points to -1.1. The most concerning development came from willingness to buy, which fell 3 points to -8.4, its lowest level since August 2024,.

Rolf Bürkl, consumer expert at NIM, noted that “the Consumer Climate has suffered another setback and starts gloomy into the new year.”

The moderate optimism seen in late 2024 has faded, with Bürkl adding that the trend since mid-2024 has been stagnation at best. A key concern is inflation, which has recently picked up again, limiting prospects for a meaningful rebound in consumer demand.

Australia's CPI slows to 2.4% in Q4, trimmed mean CPI down to 3.2%

Australia’s Q4 CPI rose just 0.2% qoq, same as the prior quarter, falling short of expectations of 0.4% yoy. Trimmed mean CPI also undershot forecasts, rising 0.5% qoq versus the expected 0.6% qoq.

On an annual basis, headline CPI slowed from 2.8% yoy to 2.4% yoy, slightly below 2.5% yoy consensus. Trimmed mean CPI fell from 3.6% yoy to 3.2% yoy, missing 3.3% yoy estimate.

These weaker inflation prints reinforce expectations that RBA may begin easing policy as early as its February 17-18 meeting.

The decline in annual inflation was largely driven by steep drops in electricity prices (-25.2%) and automotive fuel (-7.9%). Goods inflation slowed sharply to 0.8% yoy, down from 1.4% yoy in Q3. Meanwhile, services inflation remained elevated at 4.3% yoy, though slightly lower than the 4.6% yoy in the previous quarter.

In December, monthly CPI rebounded from 2.3% yoy to 2.5% yoy, matched expectations.

RBNZ's Conway sees cautious OCR path to neutral

RBNZ Chief Economist Paul Conway stated in a speech today that Official Cash Rate at 4.25% remains "north of neutral". The central bank estimates the neutral rate between 2.5% and 3.5%.

"Easing domestic pricing intentions and the recent drop in inflation expectations help open the way for some further easing," Conway added.

However, Conway emphasized a cautious approach, noting that policymakers will "feel our way" as rates approach neutral. RBNZ will continuously reassess its neutral rate estimate, adjusting based on economic conditions.

If neutral is underestimated, stronger-than-expected activity and inflation would signal a less restrictive policy than intended, prompting recalibration, he added.

The central bank expects potential output growth to range between 1.5% and 2% annually over the next three years, reflecting a lower economic "speed limit." This weaker outlook stems from sluggish productivity and reduced net immigration, limiting long-term economic capacity.

EUR/USD Daily Outlook

Daily Pivots: (S1) 1.0398; (P) 1.0447; (R1) 1.0480; More...

Intraday bias in EUR/USD stays neutral and outlook is unchanged. On the downside, break of 1.0371 support will indicate rejection by 38.2% retracement of 1.1213 to 1.0176 at 1.0572 and retain near term bearishness. Retest of 1.0176 low should be seen next. On the upside, though, decisive break of 1.0572 will raise the chance of bullish reversal, and target 61.8% retracement at 1.0817.

In the bigger picture, outlook is mixed as fall from 1.1274 (2023 high) could either be the second leg of the corrective pattern from 0.9534 (2022 low), or another down leg of the long term down trend. Strong support from 61.8 retracement of 0.9534 to 1.1274 at 1.0199 will favor the former case, and sustained break of 55 W EMA (now at 1.0722) will argue that the third leg might have started. However, sustained trading below 1.0199 will favor the latter case and bring retest of 0.9534 low.